Iowa lawmakers inch toward adjournment
Legislative leaders worked mostly behind the scenes this week crafting a massive tax relief package, setting the stage for adjourning the 2021 session potentially as early as next week.
House and Senate GOP leaders have been at odds over their must-do items on tax policy. The latest Senate bill, SF619, is a sweeping proposal that includes many of the priorities leaders from both chambers have wanted to include in tax reform this year. Among the bill’s chief provisions:
- Fully implementing income tax cuts passed in 2018 in SF2417, which reduces rates and the number of tax brackets.
- The tax changes were set to go into effect only if revenue targets were met.
- Eliminating what is known as “federal deductibility,” which allows taxpayers to deduct what they pay in federal taxes from their Iowa tax bill
- Shifting mental health services funding from local property taxes to the state
- Expanding the childcare tax credit to apply to taxpayers making up to $90,000. Currently, only those making up to $45,000 qualify for the credit.
- Phases out the inheritance tax over three years, with a full repeal in 2024
- Requires health insurers to pay providers the same rate for telehealth mental health services as they pay for an in-person visit
- Creates an Energy Infrastructure Revolving Loan Program to develop energy infrastructure.